Core Viewpoint - Aflac is addressing Japan's demographic challenges through innovation in products and market strategies, focusing on growth while maintaining expense discipline and profitability [1][3]. Financial Performance - Aflac returned nearly $4.8 billion to shareholders in 2025, including $3.5 billion in share repurchases, marking a record year and extending its dividend increase streak to 43 consecutive years [2][4]. - The company is targeting an internal capital marker near 10%, currently at approximately 6% [4][17]. Market Dynamics - In the U.S., brokers account for about 80% of the market and generated over 60% of Aflac's U.S. sales in 2025, contributing to a 14% growth in overall group products [5][13]. - Aflac is experiencing sales momentum in Japan, particularly with products aimed at younger customers, and is expanding its distribution through banks and agencies [6][11]. Product Innovation - Key products driving growth include Tsumitasu, Miraito, and Anshin Palette, with Tsumitasu designed to adjust rates as interest rates change, providing a competitive edge [9][10][12]. - The company is leveraging AI to enhance agent efficiency and streamline enrollment processes, particularly in Japan [14]. Strategic Focus - Aflac remains committed to organic growth and does not pursue M&A unless it aligns with operational and strategic goals, emphasizing a focus on supplemental health products [18]. - The company sees significant underpenetrated opportunities in the U.S. market, particularly in dental and vision insurance, and plans to increase advertising to communicate product value [19].

Core Insights - Aflac is experiencing positive growth in both the Japanese and U.S. insurance markets, with a focus on innovative products to meet changing consumer needs [2][3] Group 1: Japanese Market - Aflac has successfully introduced new products such as Tsumitasu and Miraito, focusing on cancer insurance to align with the aging population's needs [2] - The company is committed to reinventing its offerings in Japan to drive sales growth [2] Group 2: U.S. Market - Aflac reports a 3% overall increase in its U.S. market, with group products showing tremendous growth that outpaces the market [3] - The company is placing greater emphasis on its traditional business to enhance performance in the U.S. [3]

Aflac 2026 Conference Call Summary Company Overview - **Company**: Aflac Inc. (NYSE: AFL) - **Date**: February 11, 2026 - **Key Speakers**: Virgil Miller (President), David Young (SVP of Capital Markets) Key Points Industry and Market Position - Aflac operates in two of the largest insurance markets globally: Japan and the U.S. [2][3] - The company is a pioneer in the Third Sector market, particularly in cancer insurance, and continues to dominate this segment in Japan [5][6] Japan Market Insights - **Sales Growth**: Aflac has focused on innovative products to align sales growth with the aging population in Japan. The introduction of the Tsumitasu product and the cancer insurance product Miraito has led to solid growth [2][3][5] - **Target Audience**: Aflac is targeting younger consumers with products designed to be flexible and appealing, allowing existing customers to purchase additional benefits [6][7] - **Distribution Strategy**: Aflac has strengthened its distribution through bank alliances and agency forces, increasing the number of banks offering Aflac products [9][10][21] - **Product Flexibility**: The Tsumitasu product allows for rate adjustments as interest rates change, providing a competitive edge in the market [9][16] U.S. Market Insights - **Competitive Environment**: The U.S. market is highly competitive, with an increasing number of companies offering supplemental and voluntary benefits. Aflac has seen a 16% increase in the conversion rate of new agents [25][26][27] - **Sales Performance**: Aflac reported $1.6 billion in sales for the previous year, marking one of the highest sales years on record. Group products grew by 14%, significantly outpacing the market [40][28] - **Product Suite**: Aflac remains a leader in cancer insurance and supplemental health products. The company is focused on streamlining the enrollment process to enhance agent efficiency [30][31] Financial Performance - **Capital Management**: Aflac returned nearly $4.8 billion to shareholders through dividends and share repurchases, maintaining a record of 43 consecutive years of dividend increases [4][42] - **Excess Capital**: The company has significant excess capital and is focused on organic growth, with a strategy to evaluate potential M&A opportunities if gaps are identified [42][44][54] Future Outlook - **Growth Opportunities**: Aflac plans to focus on expanding its dental and vision products and enhancing its life absence and disability offerings. The company aims to leverage its strong brand reputation to drive growth in the U.S. market [61][62] - **Technological Advancements**: Aflac is utilizing AI to improve efficiency in Japan, with plans to enhance the enrollment process and customer interactions in the U.S. [35][36] Additional Insights - **Medical Inflation**: Rising medical costs and high deductibles are driving demand for supplemental insurance, which Aflac is leveraging in its sales strategy [39][41] - **Brand Recognition**: Aflac's strong brand presence in Japan and the U.S. is a key asset, with efforts to maintain consumer trust and awareness through marketing initiatives [58][61] This summary encapsulates the key insights and strategic directions discussed during the Aflac 2026 conference call, highlighting the company's performance, market strategies, and future growth opportunities.

Core Insights - Aflac Incorporated reported a decline in total revenues and net earnings for the fourth quarter and full year of 2025 compared to 2024, indicating challenges in financial performance [1][5][18]. Financial Performance - Total revenues for Q4 2025 were $4.9 billion, down from $5.4 billion in Q4 2024, representing a decrease of 9.9% [1][25]. - Net earnings for Q4 2025 were $1.4 billion, or $2.64 per diluted share, compared to $1.9 billion, or $3.42 per diluted share in Q4 2024, reflecting a decline of 27.5% [1][26]. - For the full year 2025, total revenues decreased by 9.3% to $17.2 billion from $18.9 billion in 2024 [5][25]. - Net earnings for the full year 2025 were $3.6 billion, or $6.82 per diluted share, down from $5.4 billion, or $9.63 per diluted share in 2024, marking a 33.0% decline [5][26]. Investment Gains - Q4 2025 net investment gains were $537 million, or $1.03 per diluted share, compared to $1.0 billion, or $1.86 per diluted share in Q4 2024 [2][32]. - The investment gains were influenced by net gains on derivatives and foreign currency activities, alongside losses from sales and redemptions [2]. Adjusted Earnings - Adjusted earnings for Q4 2025 were $818 million, down 5.4% from $865 million in Q4 2024 [3][32]. - Adjusted earnings per diluted share increased by 0.6% to $1.57 in Q4 2025 [3][32]. - For the full year 2025, adjusted earnings were $4.0 billion, or $7.49 per diluted share, compared to $4.1 billion, or $7.21 per diluted share in 2024, reflecting a slight decrease of 1.6% [5][34]. Shareholders' Equity - Shareholders' equity at the end of Q4 2025 was $29.5 billion, or $56.85 per share, up from $26.1 billion, or $47.45 per share at the end of Q4 2024 [4][37]. - The increase in shareholders' equity was attributed to changes in discount rate assumptions on insurance reserves [4]. Aflac Japan Performance - In yen terms, Aflac Japan's net earned premiums for Q4 2025 were ¥252.6 billion, a decrease of 1.9% year-over-year [7][8]. - Adjusted net investment income in yen decreased by 3.9% to ¥97.4 billion [7]. - For the full year, net earned premiums in yen were ¥1.0 trillion, down 3.9% from the previous year [8]. Aflac U.S. Performance - Aflac U.S. net earned premiums increased by 4.0% to $1.5 billion in Q4 2025, reflecting improved sales [12][13]. - Total adjusted revenues for Aflac U.S. were up 3.3% to $1.7 billion in Q4 2025 [12]. - For the full year, net earned premiums increased by 2.9% to $6.0 billion [13]. Capital Management - The board declared a first-quarter dividend of $0.61 per share, payable on March 2, 2026 [17]. - Aflac repurchased $800 million worth of shares in Q4 2025, with a total of $3.5 billion in share repurchases for the year [17][22].

Core Viewpoint - Aflac Incorporated (AFL) is positioned for growth due to strong U.S. business performance, product launches, acquisitions, partnerships, improved underwriting discipline, and effective cost management [2] Financial Performance - Aflac's shares have increased by 4.7% over the past six months, outperforming the industry's 2.8% rise [2] - The market capitalization of Aflac is $58.1 billion [2] - The Zacks Consensus Estimate for AFL's 2025 earnings is $7.53 per share, reflecting a 4.4% year-over-year increase [4] - Revenue estimates for 2025 are projected at $17.8 billion [4] - Aflac has beaten earnings estimates in two of the last four quarters, with an average surprise of 9.4% [4] Growth Drivers - Aflac's revenue growth is supported by strong sales in both U.S. and Japan segments, driven by strategic investments and high persistency rates [5] - New annualized premium sales in Aflac Japan grew by 16.1% year-over-year in the first nine months of 2025, primarily due to sales of the Miraito cancer insurance product and Tsumitasu [5] - Aflac U.S. saw a 3% year-over-year increase in new annualized premium sales in the first nine months of 2025, with group products contributing significantly [6] - The company is enhancing its core insurance growth through strategic acquisitions and partnerships, expanding its capabilities and reach [7] Financial Position - Aflac concluded the third quarter of 2025 with $6.8 billion in cash and cash equivalents, an increase from $6.2 billion at the end of 2024 [8] - The company maintains a strong times-interest-earned ratio of 25.39X, compared to the industry average of 20.02X [8] - Aflac has prioritized shareholder rewards, repurchasing 25.7 million shares worth $2.7 billion in the first nine months of 2025 [8]

Core Insights - Aflac Incorporated reported strong third-quarter results for 2025, with total revenues of $4.7 billion, a significant increase from $2.9 billion in the same quarter of 2024, primarily due to net investment gains of $275 million compared to losses of $1.4 billion a year ago [2][3][19] Financial Performance - Net earnings for the third quarter of 2025 were $1.6 billion, or $3.08 per diluted share, a turnaround from net losses of $93 million, or $0.17 per diluted share, in the previous year [2][3][26] - Adjusted earnings for the third quarter were $1.3 billion, reflecting a 9.6% increase from $1.2 billion in the same quarter of 2024, with adjusted earnings per diluted share rising 15.3% to $2.49 [3][32] - For the first nine months of 2025, total revenues decreased by 9.1% to $12.3 billion, with net earnings of $2.3 billion, or $4.21 per diluted share, down from $3.5 billion, or $6.23 per diluted share, in the same period of 2024 [6][11][34] Shareholders' Equity - Shareholders' equity at the end of the third quarter was $28.7 billion, or $54.57 per share, up from $24.8 billion, or $44.60 per share, a year earlier [5][7] - The annualized return on average shareholders' equity in the third quarter was 23.5% [5] Aflac Japan Performance - In yen terms, Aflac Japan's net earned premiums were ¥245.2 billion for the quarter, a 4.0% decrease year-over-year, while adjusted net investment income was relatively flat at ¥98.0 billion [8][9] - The pretax adjusted profit margin for the Japan segment improved to 52.2%, compared to 44.7% a year ago [8] Aflac U.S. Performance - Aflac U.S. net earned premiums increased by 2.5% to $1.5 billion in the third quarter, supported by improved sales [13][14] - The pretax adjusted profit margin for the U.S. segment was 21.7%, up from 20.8% a year ago [13] Sales and New Products - Total new annualized premium sales increased by 11.8% to ¥19.6 billion, primarily driven by strong sales of the new cancer insurance product, Miraito [12] - For the first nine months, total new sales increased by 16.1% to ¥54.4 billion [12] Capital Management - The board declared a fourth-quarter dividend of $0.58 per share, with a total of $1.0 billion deployed for share repurchases in the third quarter [18][22] - The company maintains a strong commitment to capital management and liquidity, celebrating 43 consecutive years of dividend increases [22]

Core Insights - Aflac Incorporated (AFL) is positioned for growth due to expanding sales in Japan and the U.S., a trusted brand, innovative products, strict underwriting discipline, and effective cost management [1][3][4] Sales Performance - Sales in Japan increased by 18.7% year-over-year in the first half of the year, reaching $236 million, driven by strong sales of Miraito and efforts to attract younger customers with Tsumitasu [3][9] - U.S. sales rose by 3.1% year-over-year to $649 million, with group life and disability products contributing significantly to this growth [3][9] Margin Analysis - The company anticipates pretax margins of 30-33% in Japan and 17-20% in the U.S. for 2025, with the U.S. segment achieving a 22.5% pretax margin in the second quarter due to cost-control measures [4][9] Business Resilience - Demand for supplemental insurance remains strong, as these products address coverage gaps rather than compete with traditional offerings, providing Aflac with a stable revenue stream less affected by economic fluctuations [5] Shareholder Value Initiatives - Aflac prioritized shareholder rewards, repurchasing 7.9 million shares worth $829 million in the second quarter and authorizing an additional 100 million shares for repurchase, totaling approximately 130.9 million shares remaining [6] - The company extended its dividend growth streak to 42 consecutive years in 2024, with total capital deployment reaching $2.4 billion in the first half of 2025 [6] Earnings Performance - Aflac's earnings have exceeded the Zacks Consensus Estimate in two of the last four quarters, with an average surprise of 6.6% [7] Industry Competitors - Competitors like AMERISAFE, Inc. and Globe Life Inc. are also active in the market, with AMERISAFE focusing on workers' compensation and maintaining a strong retention rate, while Globe Life benefits from steady premium income and underwriting margins [10][11]

Core Insights - Aflac Incorporated reported a significant decline in total revenues and net earnings for the second quarter of 2025 compared to the same period in 2024, primarily due to net investment losses [2][3][7] Financial Performance - Total revenues for Q2 2025 were $4.2 billion, down 19.0% from $5.1 billion in Q2 2024 [2][27] - Net earnings fell to $599 million, or $1.11 per diluted share, a decrease of 65.9% from $1.8 billion, or $3.10 per diluted share, a year earlier [2][27] - Adjusted earnings for Q2 2025 were $957 million, down 7.5% from $1.0 billion in Q2 2024 [4][32] Investment Performance - The company experienced net investment losses of $421 million in Q2 2025, compared to net investment gains of $696 million in Q2 2024 [3][37] - Adjusted net investment income for Q2 2025 was $1.036 billion, a slight increase of 0.3% from $1.033 billion in Q2 2024 [38] Shareholder Equity - Shareholders' equity increased to $27.2 billion, or $50.86 per share, at June 30, 2025, compared to $26.0 billion, or $46.40 per share, at June 30, 2024 [6][39] - The annualized return on average shareholders' equity for Q2 2025 was 9.0% [6][40] Segment Performance - Aflac Japan's net earned premiums in yen decreased by 4.8% to ¥254.6 billion in Q2 2025, primarily due to internal cancer reinsurance transactions [9][10] - In dollar terms, Aflac U.S. net earned premiums increased by 3.4% to $1.5 billion in Q2 2025, reflecting improved sales and persistency [14][15] Sales and Growth - Total new annualized premium sales in Aflac Japan increased by 23.2% to ¥20.7 billion, or $143 million, in Q2 2025 [13] - Aflac U.S. sales increased by 2.7% in Q2 2025 to $340 million, benefiting from group life and disability products [16] Capital Management - The board declared a third-quarter dividend of $0.58 per share, payable on September 2, 2025 [19] - Aflac repurchased $829 million in shares during Q2 2025, with 30.9 million shares remaining authorized for repurchase [19][23]